Large corporations and other major users of telecommunications services often spend hundreds of millions of dollars on such services annually. These customers commonly use multiple telecommunications carriers to provide the services required for various types of traffic, such as, for example, voice, cellular, paging, and data transmission. Additional telecommunications carriers may be used for certain classes of service, such as calls and other traffic between specific locations or at certain times. Furthermore, multiple telecommunications carriers are commonly used for the exact same class of service, for purposes of introducing redundancy in the customer's telecommunications resources, and for other reasons. As used herein, the term “class of service” means a particular telecommunications service for transmitting voice, data, or other signals between two geographic locations. Each different type of traffic transmitted and each different origination and destination region for the traffic may constitute a unique class of service. Class of service definitions are primarily dependent upon how telecommunications carriers distinguish traffic for the purpose of applying different rates.
Large telecommunications customers typically employ analysts who review billing statements, perform audits, and request new telecommunications installation and services for the entire organization. Telecommunications analysts monitor the customer's telecommunications spending to identify overcharges and mistakes made by service providers and to minimize expenditures generally. To perform these tasks, the analyst reviews the detailed billing statements provided by carriers. Carriers commonly provide bills on a monthly basis in a computer-readable format, such as a CD-ROM, but may use other formats, such as paper, magnetic tape, EDI, and the World Wide Web.
Analyzing telecommunications billing statements can be burdensome due to the volume of information they include. This is especially true when multiple carriers are used, because the carriers do not typically use the same billing format or provide the same kinds of traffic information. Different carriers may also use different service class codes to identify the same class of telecommunications service, making it difficult to compare competitor rates. Furthermore, the data included in computer-readable billing statements may be stored in a nonstandard database format or may require special bill viewing software that is unique to the carrier. Due to the volume of call data and the different data formats, it is often too burdensome for an analyst to track all telecommunications traffic on a monthly basis. Consequently, many choose to merely perform audits in an attempt to avoid gross carrier overcharges and mistakes. Thus, a need exists for an improved method of monitoring and analyzing telecommunications spending.
Large telecommunications customers use their buying power to negotiate telecommunications services contracts having a desired balance of competitive rates and service plan features. To begin the negotiation process, historical call data is typically gathered by the customer, e.g., from past bills, and used to help forecast telecommunications needs for the duration of the proposed contract term. Since different telecommunications carriers deliver computer-readable billing data in different formats, the task of compiling historical use summaries and forecasting traffic is highly burdensome for a large company, especially a global company dealing in various languages and currencies. A large company may spend weeks or months compiling the necessary information and preparing telecommunications forecasts.
To further complicate the forecasting process, the information provided in carriers' standard billing formats make it very difficult to determine the actual rates applied to particular traffic. For example, a contract between a customer and a single carrier may specify 150 different rates for hundreds of different classes of voice traffic. Service contracts may also specify discounts applicable to only a few of the contract rates in particular circumstances, such as when a volume exceeds a predetermined target. Voice traffic classes may differentiate telecommunications traffic based on origination location, termination location, whether the traffic was incoming or outgoing, the time of the traffic event, and the rate schedule to be applied. Rates for a particular call may even vary during the duration of the call. However, service class designators are not typically listed in the billing formats used by most carriers. Also, while the service contract may clearly define the applicability of discounts, carrier bills often fail to clearly identify calls to which the discounts have been applied. Consequently, summarizing and analyzing billing information is a complicated task.
Once summary information has been gathered, the customer uses it to prepare a traffic forecast including the desired classes of service and anticipated quantity of traffic per class of service. The forecast telecommunications needs are then set forth in a request for proposals (RFP) that is distributed to potential telecommunications vendors. While the customer will typically seek the most competitive rates, other terms unrelated to rates may also be important. For example, the RFP may specify nonprice service plan features desired by the customer, such as the contract duration, renewal period, quality of service, refund policy, warranties, customer service response time, customer service escalation procedures, multilingual support services, e-mail response services, exclusivity terms, discounts, installation fees, risk allocation, contract renewal terms, and/or termination conditions. In response to the RFP, each interested vendor prepares a detailed proposal that represents a bid for the services or a portion thereof. Using traditional telecommunications RFP methods, the bidding period typically lasts a month or more. During the bidding period, each interested vendor submits a single proposal that represents the bidder's best shot at winning the business. Such proposals commonly include significant amounts of sales and advertising information, extensive legal terms, variations on the requested service (substitutions), and other details that make the proposal difficult to evaluate. For example, three proposals made in response to a medium size RFP valued at about $12 million recently took a team of 20 people an entire month to review and extract relevant bid information. The burden of the RFP process prompts many large telecommunications customers to hire independent consultants skilled in preparing RFPs and evaluating vendor proposals.
Once the vendor proposals have been collected and analyzed, the customer must choose one or more of the vendors to provide services to meet its telecommunications needs. Finalizing a service contract may involve negotiation and fine tuning of certain proposed contract terms.
To guarantee competitive rates, telecommunications services contracts may include minimum usage or spending commitments during the term of the contract. Such contract provisions impose penalties on customers that fail to meet the minimum use commitments. Once a contract is in place, a customer will want to monitor use relative to the minimum use commitments for budgeting purposes and to take corrective action (in addition to monitoring for overcharges and mistakes, as described above). If multiple carriers are used for the same type or class of service, the customer may be able to offset projected usage deficits under a contract with a first carrier by redirecting surplus call traffic from a second carrier. Some contracts may also allow rate adjustments to be made during their term. In some cases, the customer may be able to renegotiate the contract to avoid significant penalties.
Telecommunications rates have declined in recent years and are expected to continue dropping. The potential cost reductions made possible by downward market movement can justify incurring the expense of the RFP and contract negotiation process on a regular basis. The frequency by which a customer should put its traffic up for bid is partly a function of the rate at which the market is moving and the expense of the RFP process. Monitoring of usage can help the customer to determine when to next put its telecommunications traffic up for bid. In recent years, major telecommunications users have engaged in the RFP and contract negotiation process once every 12 to 36 months, although many would do so more frequently if the RFP process required less effort and expense.
Thus, a need exists for methods and systems for reducing the cost of the RFP process so that telecommunications customers can afford to put traffic up for bid more frequently. A need also exists for an improved method of monitoring telecommunications usage and costs relative to the market prices, to thereby improve the timing of the RFP process and reduce telecommunications spending.